Friday, December 28, 2007

Today, the U.S. Census Department released its monthly New Residential Home Sales Report for November showing a further deterioration of the already hideous falloff in demand for new residential homes both nationally and in every region as well as again reporting significant downward revisions to August, September and October’s results.

On a year-over-year basis new home sales are continuing to weaken, dropping a truly ugly 34.4% below the sales activity seen in November 2006 representing the largest year-over-year decline registered during this current housing bust.

It’s important to keep in mind that these declines are coming on the back of the significant declines seen in 2006 further indicating the significance of the housing bust.

It’s important to note that although inventories of unsold new homes have been dropping for eight straight months, the sales volume has been declining so significantly that the sales pace has now reached a near peak value of 9.3 months of supply.

The following charts show the extent of sales declines seen since 2006 as well as illustrating how the further declines in 2007 are coming on top of the 2006 results (click for larger versions)

Note that the last chart essentially combines the year-over-year changes seen in 2005, 2006 and 2007 and shows sales trending down precipitously as compared to the peak period.

Look at the following summary of today’s report:

National

The median price for a new home was down .41% as compared to November 2006.

New home sales were down 34.4% as compared to November 2006.

The inventory of new homes for sale declined 6.8% as compared to November 2006.

The number of months’ supply of the new homes has increased 43.1% as compared to November 2006.

Regional

In the Northeast, new home sales were down 28.1% as compared to November 2006.

In the West, new home sales were down 33.8% as compared to November 2006.

In the South, new home sales were down 34.3% as compared to November 2006.

In the Midwest, new home sales were down 38.7% as compared to November 2006.

In fact, MAR reports that in November, single family home sales plummeted 12.6% as compared to November 2006 with a median price decline of 2.9%.

Not to be deterred by the latest downturn in sales, Azarian continues his attempt to bamboozle the hapless homebuyer with a fresh take on deceptive spin:

“If your New Year’s resolution is to buy a home, you have the market to do it in, … We are in a ‘buyer’s market’ that really favors first-time homebuyers who don’t have a home to sell. In fact, first-time homebuyers could be one of the keys to reversing the downward sales trend of the last several months.”

Like the new spin? How about some of Azarian’s past attempts from earlier this year:

April 2007 – “The housing market in Massachusetts is gaining momentum and we can continue to feel good about where it is headed. With prices remaining stable and supplies decreasing, we can expect the spring home buying season to be active.”

June 2007 – “We can speculate that demand will continue to go up during the second half of the year.”

August 2007 – “If inventory and supply continue to decline, we should see prices remaining steady, if not continuing to tick up, through the rest of the summer and the fall,”

September 2007 – “Combined with the recent interest rate drop by the Fed and continued legislative action on Capitol Hill, the potential for continued sales growth through the fall is good.”

Is Azarian ignorant?

No. He’s a professional business owner with a vested interest in attempting to spin the outlook so as to profit from your home purchase.

Does he care that he might succeed in goading first time home buyers into making purchases near the top of a historic deflationary price spiral?

No. That’s precisely his goal.

As usual, The Warren Group’s latest figures were significantly different than that of MARs showing single family sales down 15.4% and a median price decline of 5.8% as compared to November of 2006.

We are now clearly seeing the result of the mortgage-credit meltdown with home sales resuming double digit year-over-year declines in September, October and November and even more notably, coming on the back of last year’s historic falloff.

As I predicted, the last three monthly results of the S&P/Case-Shiller index for Boston has shown renewed price declines indicating that as the mortgage-credit crisis unwinds, our area is not immune.

To better illustrate the drop-off in home prices and the potential length and depth of the current housing decline, I have compared BOTH the year-over-year and peak percentage changes to the S&P/Case-Shiller home price index for Boston (BOXR) from the 80s-90s housing bust to today’s bust (ultra-hat tip to the great Massachusetts Housing Blog for the concept).

The “year-over-year” chart compares the percentage change, on a year-over-year basis, to the BOXR from the last positive value through the decline to the first positive value at the end of the decline.

In this way, this chart captures only the months that showed monthly “annual declines” and as we can see, if history is to be a guide, we could be about one third of the way through the annual price declines with the majority of falling prices yet to come.

The “peak” chart compares the percentage change, comparing monthly BOXR values to the peak value seen just prior to the first declining month all the way through the downturn and the full recovery of home prices.

In this way, this chart captures ALL months of the downturn from the peak to trough to peak again.

As you can see the last downturn lasted 105 months (almost 9 years) peak to peak including 34 months of annual price declines during the heart of the downturn.

Yesterday’s release of the S&P/Case-Shiller home price indices for October continues to reflect significant weakness for the nation’s housing markets with 17 of the 20 metro areas tracked reporting year-over-year declines and now ALL metro areas showing declines from their respective peaks.

Furthermore, the decline to the 10 city composite index declined a record 6.7% as compared to October 2006 surpassing the prior year-over-year decline record of 6.3% set back in April of 1991 (see charts below for best view) firmly placing the current decline in uncharted territory in terms of relative intensity.

This report appears to indicate, at least initially, that during the fall we essentially entered a price “free-fall” phase of the housing decline.

Topping the list of peak decliners are Detroit at -14.88%, Tampa at -13.32%, San Diego at -13.31%, Miami at -13.00%, Phoenix at -11.74%, Las Vegas at -11.12%, Washington at -9.70%, Los Angeles at -8.92%, San Francisco at -7.48%, Boston at -7.19%.

Additionally, both of the broad composite indices showed accelerating declines slumping -7.34% for the 10 city composite indexand -6.60% for the 20 city composite index on a peak comparison basis.

Also, it’s important to note that Boston, having been cited as a possible example of price declines abating, has continued its decline dropping -3.63% on a year-over-year basis and a solid -7.19% from the peak set back in September 2005.

As I had noted in prior posts, Boston has a strong degree of seasonality to its price movements and with both the seasonal drop in sales and the recent stunning new decline to sales as a result of the disappearance of Jumbo and Alt-A loans, Boston will likely continue on yet another significant leg down in prices.

The following chart (click for larger version) shows the percent change to single family home prices given by the Case-Shiller Indices as compared to each metros respective price peak set between 2005 and 2007.

The following chart (click for larger version) shows the percent change to single family home prices given by the Case-Shiller Indices as compared to October 2006.

Additionally, in order to add some historical context to the perspective, I updated my “then and now” CSI charts that compare our current circumstances to the data seen during 90s housing decline.

To create the following annual charts I simply aligned the CSI data from the last month of positive year-over-year gains for both the current decline and the 90s housing bust and plotted the data with side-by-side columns (click for larger version).

What’s most interesting about this particular comparison is that it highlights both how young the current housing decline is and clearly shows that the latest bust has surpassed the prior bust in terms of intensity.

Looking at the actual index values normalized and compared from the respective peaks, you can see that we are only sixteen months into a decline that, last cycle, lasted for roughly fifty four months during the last cycle (click the following chart for larger version).

The “peak” chart compares the percentage change, comparing monthly CSI values to the peak value seen just prior to the first declining month all the way through the downturn and the full recovery of home prices.

In this way, this chart captures ALL months of the downturn from the peak to trough to peak again.

As you can see the last downturn lasted 97 months (over 8 years) peak to peak including roughly 43 months of annual price declines during the heart of the downturn.

Notice that peak declines have been FAR more significant to date and, keeping in mind that our current run-up was many times more magnificent than the 80s-90s run-up, it is not inconceivable that current decline will run deeper and last longer.

The purchase application index has been highlighted as a particularly important data series as it very broadly captures the demand side of residential real estate for both new and existing home purchases.

The latest data is showing that the average rate for a 30 year fixed rate mortgage decreased since last week to 6.10% while the purchase volume decreased 6.6% and the refinance volume decreased 8.5% compared to last week’s results.

As I had speculated in the prior MBA posts, today’s results strongly confirm that the “spike up” in volume seen during the first two weeks of December was likely the result of problematic seasonal adjustment.

Both the purchase and re-finance volumes have now completely retraced back to the lowest levels reported in 2007 strongly suggesting that the early December activity was simply a statistical “blip”.

Also note that the average interest rates for 80% LTV fixed rate mortgages have headed back up, closer to the mean for the year and that the interest rate for a 80% LTV 1 year ARM remains elevated with only a 2 basis point spread under the 30 year fixed rate.

It’s important to note that the data is reported (and charted) weekly and that the rate data represents average interest rates, and the index data represents mortgage loan application volume for home purchases, home refinances and a composite of all loans.

The following chart shows how the principle and interest cost and estimated annual income required to cover the PITI (using the 29% “rule of thumb”) on a $400,000 loan has changed since January 2007.

The following chart shows the average interest rate for 30 year and 15 year fixed rate mortgages over the last number of weeks (click for larger version).

The following charts show the Purchase Index, Refinance Index and Market Composite Index since January 2007 (click for larger versions).

Baron attempted to justify the articles contents and in so doing, he disclosed his poor and obviously unsophisticated abilities with even the most basic economic data.

November’s results again confirm that Arlington is by no means a “stand out” amongst its neighboring towns as Baron suggested in his email and, in fact, is following along on a path wholly consistent with the trend seen in the county, state, region and nation.

Why would an editor of a nationally recognized newspaper think that a single town would continue to function as an isolated bubble amongst a backdrop of the most significant nationwide housing recession since the Great Depression?

Again I was reminded this month, in a truly grotesque turn, that Realtors in Arlington have been handing out copies of this article during open houses in yet another shameless attempt to bamboozle buyers into confidence and activity.

November’s raw results (as reported by The Warren Group) show us the following for Arlington:

Monthly median home sales price of $465,750.

Year-to-Date median home sales price of $465,000, the lowest value since 2003.

Monthly home sales count of 18.

Year-to-Date home sales count of 309.

As I had shown in my prior post, this data when charted and compared to other towns in the region proves there are absolutely no grounds to call Arlington’s market exceptional.

The following chart (click for much larger version) shows how Arlington’s median sales price has changed since 1988, the first year the data was tracked by the Warren Group. Notice that while the current monthly result is clearly the most jagged and volatile measure, all three (monthly, year-to-date, and annual) measures are essentially saying the same thing, namely median prices are going down.

The next chart (click for much larger version) shows that home sales in Arlington have been essentially flat during the last 15 years, a result that is generally to be expected when looking only at the sales of one town in isolation.

The final chart shows how the year-to-date median sales price for Arlington, Bedford, Belmont, Cambridge and Lexington has changed since 1988. Notice that each town is essentially staying on the same track having made great strides during the boom and now firmly headed lower.

In review, the data shows that there is nothing exceptional about Arlington’s housing market proving clearly that the claims made in the Boston Globe article and later endorsed by its editor Martin Baron were entirely erroneous.

Monday, December 24, 2007

Gather 'round all ye bubble-sitting families and partake in a reading of a warm old holiday classic by Dr. SoldAtTheTop!

Every BullDown in Bull-villeLiked the Housing Bubble a lot...

But the Bear,Who lived just South of Bull-villeDid NOT!

The Bear hated the Bubble!He blamed the Fed, rates and lending!But the Bulls didn't care, they just kept right on spending.It could be that Bulls were just very trendy.It could be, perhaps, they were whipped into a speculative frenzy.But I think the most likely reason of allMay have been that their noggins were two sizes too small.

But,Whatever the reason,Their heads or the craze,They continued to spend, for days upon days.And the Bear, staring up from his cave down belowSensed the limit had been reached, things were going to BLOW!For he knew every Bull up in Bull-ville that nightHad stretched every dollar, squeezed their finances tight.

"And they're going back for more!" he could see to his dismay"This just cannot last, not for one more day!"Then he ran to his closet to fetch a loud-speaker"I MUST warn them all, before they get in any deeper!"For, the Bear knew...

...All the Bull girls and boysWho had been flipping, and borrowing and buying up toysWere all skirting the edge, sitting perfectly poisedFor collapse that once realized... oh, the noise! Noise! Noise! Noise!

Then the Bulls, young and old, will be in a terrible fix.And they'd have to hunker down and stop all their mad tricks!And the economy... oh what a mighty deep-six!It will sink faster than boat load of bricks!

And THENSomething would happen that he liked least of all!Every Bull up in Bull-ville, the tall and the small,Would all start to panic, when home prices stop swelling.They'd reverse the craze… they'll all begin selling!

They'd sell! And they'd sell!AND they'd SELL! SELL! SELL! SELL!And the more the Bear thought of the Bull-Panicky-SellThe more the Bear thought "This is NOT going to end well!""Why for almost a decade I've watched the bubble inflate!I MUST warn them now!Before it's TOO LATE!"

THENHe mounted the loud-speakerTo the top of his carAnd a siren with flood lightsThat were blazing like stars

Then the Bear said, "I’m off!"And he drove forty blocksToward the homes that the BullsHad been trading like stocks.

All their windows were bright. Flat panel glow filled the air.All the Bulls were all carrying-on without even a careWhen he came to a stop in the Bull-ville town square."This is the best place," the Bear thought as he reachedFor the microphone that he would use when he preached.

THENClick! On went the siren, the lights and the speaker!Then the Bear started yelling! "Things are looking bleaker and bleaker!You all must come out, listen to what I have to sayGive me a chance to appeal to your senses today!"

Then one Bull emerged through his front door.Then another came out, and some more... then still more.Soon the square was abuzz with a large crowd of BullsAll grumbling and muttering about association rules.

But the Bear went on "You are all in grave trouble!I have come here to warn you of the Great Housing Bubble!You see it's been inflating, stretching thinner and thinner..If you don't stop now, there will be almost no winners!"

"This is the greatest Ponzi-scheme ever devisedWhere all of you have been convinced to not question your eyes.Just go right on speculating... pushing prices up higherAnd assume there will always be a greater fool buyer!"

"But Things are now not looking so hot...Home sales are plunging, The builders are shot!Inventory is rising, there is no place to hide.Soon you will be in for a vicious price slide!"

Then he clicked off the speaker and he heard not a sound.The Bulls all looked puzzled, just standing around.Then one Bull, an Economist named David Lereah (Pronounced Le-ray)Stood up and he shouted, "I have something to say!"

"You are a very foolish Bear!" He said with a sigh"This is a GREAT time to SELL or to BUY!Yes prices are moderating, that much is sure true.But that is a HEALTHY sign that the market will pull right on through.I've seen all the numbers, I release them you know...And what I've seen is STABILIZATION as we level off at the low"

"So pack up your things and head off down the hill!We don't need your type of hype in Bull-ville!"

So the Bear did as he was told, all downhearted and grim.He silently opened his car door and stepped in.And he backed down the hill and then crawled into his cave.And he thought about the Bull-ville that he failed to save.

But just then the Bear heard a horrible sound!A massive explosion that sent shock waves through the ground!As he looked from his window, he could not believe either eye...The whole of Bull-ville had been blown to the sky!

And what happened then...?Well, in Bear-ville they sayThat although he was sad...His pride grew three sizes that day!And the minute his heart stopped feeling so blueHe published a book titled "What To Do and Not To Do If a Bubble Finds You!"

Friday, December 21, 2007

Today’s release of the Reuters/University of Michigan Survey of Consumers for December confirmed again that the U.S. consumer is feeling the burn from declining home values, increased fuel costs and a general uncertainty about the future of the economy.

In fact, short of a brief plunge in the wake of Hurricane Katrina, the current levels for the Index of Consumer Sentiment and the Index of Consumer Expectations are at lows not seen since the early 1990’s.

The Index of Consumer Sentiment fell 17.67% as compared to December 2006 mostly as a result of consumers’ expectations of future economic prospects.

The Index of Consumer Expectations (a component of the Index of Leading Economic Indicators) fell a whopping 19.21% below the result seen in December 2006.

As for the current circumstances, the Current Economic Conditions Index fell 15.82% as compared to the result seen in December 2006.

As you can see from the chart below (click for larger), the consumer sentiment data is a pretty good indicator of recessions leaving the recent declines possibly foretelling rough times ahead.

Thursday, December 20, 2007

The FRBB, together with five prominent banks (Bank of America, Citizens Bank, Sovereign Bank, TD Banknorth, and Webster Bank), have created what they term a “Mortgage Relief Fund” of $125 Million allocated to “make it easier for some homeowners who are paying high rates – and those who face a reset of an adjustable-rate loan – to refinance into a more affordable mortgage, avoid delinquency, and avoid foreclosure.”

First, it’s important to understand that this “fund” is essentially simply a commitment to make new home loans to "qualifying" homeowners and in a sense can be interpreted as a commitment to not flatly deny troubled homeowners access to loans with better terms.

Each of the five banks are in the business (at least in part) of making home loans, so by participating in this “fund”, they are simply stating that they will each consider lending up to $25 million to existing troubled homeowners so long as they meet basic qualifications.

But what are the basic qualifications homeowners must meet in order to be considered worthy of being lent to?

Your house is worth MORE than the total of your mortgage loan balance(s)

You have generally made your mortgage payments on time

You reside in the property

You can document your current income

Then you “may” be eligible for consideration under this initiative.

Additionally, it’s important to understand that this effort is NOT simply a private affair as each lender will be turning to both the New England state governments and the federal government for assistance in both insuring and underwriting these loans as stated in the release.

“The banks expect to incorporate Federal Housing Administration (FHA) insurance and beneficial aspects of state programs, which often include flexible underwriting and eligibility guidelines.”

Finally, since $125 million can at best help 500 homeowners (each with $250,000 mortgage obligations), the FRBB has stated that if demand were to surpass the initial amount “funded”, they would consider expanding the program “especially if the mortgages can be securitized.”

All in all this initiative, though it may be touted with high and congratulatory praise, represents virtually no real effort to address the debacle we see before us today and, in fact, seems to provide further evidence that the Federal Reserve is seriously underestimating the severity of the situation.

Today, the Bureau of Economic Analysis (BEA) released their third and final installment of the Q3 2007 GDP report showing an annual growth rate of 4.9%, buoyed by strength in, among other things, nonresidential structures, outstanding exports of goods, and federal, state and local government spending while continuing to be weighed down by tremendous weakness to fixed residential investment.

Residential fixed investment, that is, all investment made to construct or improve new and existing residential structures including multi–family units, renewed its historic fall-off registering a whopping decline of 20.5% while shaving 1.08% from overall GDP.

Housing continues to be, by far, the most substantial single drag on GDP subtracting an amount greater than the contributions made by all personal consumption of durable (cars, furniture, etc.) and non-durable goods (food, clothing, gasoline, fuel oil) during the quarter.

Wednesday, December 19, 2007

Whether it was his inability to see the sheer enormity of the housing-mortgage debacle even as late as this July, or the blurting out of a proposal to temporarily increase the conforming loan limit, a limit utilized by government agencies that are tasked to promote “affordable” housing, to “$1 million” or his casual but confident dismissal of any concern related to the potential risks posed by a historically weak dollar, Bernanke has now clearly shown a pattern of ineffectiveness and poor perspective.

Add to that this following excerpt from yesterday’s meeting on proposed rule changes for the mortgage industry.

“The housing and mortgage sectors in recent years have benefited from a remarkable wave of financial innovation. The advent of large secondary markets and the use of automated underwriting [inaudible], for instance, have driven more capital to the system and in many ways have helped our mortgage markets function more efficiently. By and large, this has meant lower costs for consumers buying homes.”

I’ll leave the comparing and contrasting to you as an exercise but suffice it to say that the “By and large, this has meant lower costs for consumers buying homes” is NOT present.

The point here is that, although it’s hardly debatable that recent “financial innovations” have more efficiently extended far more debt to many more people than at any other time in history, given our current predicament, this fact should hardly hold any positive connotation and consumers have, in fact, NOT received the benefit of lower costs by any stretch of the imagination.

The financial innovation ushered in the worst era of dramatically inflated housing costs leaving the affordability simply for shelter at its lowest levels in history.

Now, the collapse of this era will cost the public even more as the private sector nimbly shirks its responsibilities of absorbing the full price of the risks involved in their actions leaving the taxpayer to both “mop the aftermath” as well as absorb the specific losses that will be suffered by the many millions of American families that were caught up in years of this financial distortion.

The purchase application index has been highlighted as a particularly important data series as it very broadly captures the demand side of residential real estate for both new and existing home purchases.

The latest data is showing that the average rate for a 30 year fixed rate mortgage increased since last week to 6.18% while the purchase volume decreased 10.6% and the refinance volume decreased 27.3% compared to last week’s results.

As I had speculated in the prior two MBA posts, today’s results apparently confirm that the dramatic “spike up” in volume seen during the first two weeks of December was really the result of problematic seasonal adjustment mirroring a similar aberration seen last year.

Both the purchase and re-finance volumes have now completely retraced back to levels reported in October and early November strongly suggesting that the early December activity was simply a statistical “blip”.

Also note that the average interest rates for 80% LTV fixed rate mortgages have moved higher nearing the mean for the year and that the interest rate for a 80% LTV 1 year ARM is close to the peak for the year and well above the fixed rates.

It’s important to note that the data is reported (and charted) weekly and that the rate data represents average interest rates, and the index data represents mortgage loan application volume for home purchases, home refinances and a composite of all loans.

The following chart shows how the principle and interest cost and estimated annual income required to cover the PITI (using the 29% “rule of thumb”) on a $400,000 loan has changed since January 2007.

The following chart shows the average interest rate for 30 year and 15 year fixed rate mortgages over the last number of weeks (click for larger version).

The following charts show the Purchase Index, Refinance Index and Market Composite Index since January 2007 (click for larger versions).

Tuesday, December 18, 2007

Today’s New Residential Construction Report continues to firmly indicate the intensity of the second leg down in the decline to the nation’s housing markets and for new residential construction showing substantial declines on a year-over-year and month-to-month basis to single family permits both nationally and across every region.

Single family housing permits, the most leading of indicators, again suggests extensive weakness in future construction activity dropping 33.7% nationally as compared to November 2006.

Moreover, every region showed significant double digit declines to permits with the West declining 39.6%, the South declining 36.6%, the Midwest declining 20.6% and the Northeast declining 20.9%.

Keep in mind that these declines are coming on the back of last year’s record declines.

To illustrate the extent to which permits and starts have declined, I have created the following charts (click for larger versions) that show the percentage changes of the current values compared to the peak years of 2004 and 2005.

Notice that on each chart the line is essentially combining the year-over-year changes seen in 2005, 2006 and 2007 showing virtually every measure trending down precipitously.

Although year-over-year declines to permits have not accelerated measurably in terms of maximum monthly YOY declines, the fact we are continuing to see declines of roughly 20%-30% on the back of 2006 declines should provide a an unequivocal indication that the housing markets are by no means stabilizing.

Here are the statistics outlined in today’s report:

Housing Permits

Nationally

Single family housing permits down 33.7% as compared to November 2006.

Regionally

For the Northeast, single family housing down 20.9% as compared to November 2006.

For the West, single family housing permits down 39.6% as compared to November 2006.

For the Midwest, single family housing permits down 20.6% as compared to November 2006.

For the South, single family housing permits down 36.6% compared to October 2006.

Housing Starts

Nationally

Single family housing starts down 34.9% as compared to November 2006.

Regionally

For the Northeast, single family housing starts down 29.9% as compared to November 2006.

For the West, single family housing starts down 38.3% as compared to November 2006.

For the Midwest, single family housing starts down 28.6% as compared to November 2006.

For the South, single family housing starts down 36.1% as compared to November 2006.

Housing Completions

Nationally

Single family housing completions down 28.5% as compared to November 2006.

Regionally

For the Northeast, single family housing completions down 32.7% as compared to November 2006.

For the West, single family housing completions down 19.2% as compared to November 2006.

For the Midwest, single family housing completions down 26.0% as compared to November 2006.

For the South, single family housing completions down 32.9% as compared to November 2006.

Keep in mind that this particular report does NOT factor in the cancellations that have been widely reported to be occurring in new construction.

The release came along with a renewed sense of reality and some guarded, yet optimistic, outlook from Chief Economist David Seiders continues to look for an “upswing” in building activity in the second half of 2008.

“Today’s report shows that builders’ views of housing market conditions haven’t changed in the past several months, and there clearly are signs of stabilization in the HMI … At this point, many builders are bracing themselves for the winter months when home buying traditionally slows, scaling down their inventories and repositioning themselves for the time when market conditions can support an upswing in building activity – most likely by the second half of 2008.”

It’s important to understand that each component of the NAHB housing market index is now sitting at OR BELOW the worst levels ever seen in the over 20 years the data has been being compiled.

This suggests that the current severe correction has surpassed all other events seen in the last 22 years and is now firmly in uncharted territory.

Measuring builder confidence across six key data points, the builder survey has been a bellwether for the new home market since 1985.

The component measures used to formulate the overall HMI are respondent ratings on “present conditions”, “future conditions” and “buyer traffic” all of which continue to indicating significant current and future weakness as the new home market slumps its way slowly forward.

The following charts show “present conditions”, “future conditions” and “buyer traffic” both smoothed since 1986 and unadjusted since 2005 (click for larger versions).

Keep in mind that for each measure respondents are asked to assign both a “good” and “poor” rating so in each chart you will notice “good” slumping while “poor” is surging.